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Gas Prices Expected to Drop In Coming Weeks

As travel demand decreases after a busy holiday travel season, prices at the pump should decrease as well.

Californians will kick off 2018 with the most expensive gas to begin a year since 2014, according to AAA, but prices are expected to fall in coming weeks as travel demand subsides after a busy holiday travel season.

At $3.10, California’s average price for a gallon of regular unleaded gasoline today is 33 cents more than drivers paid in January, 2017. At nearly $3.23 per gallon, San Francisco residents are paying the highest prices for gas in Northern California — 3 cents more than motorists in South Lake Tahoe, which normally tops the charts for the region.
“Last year was a historic travel season, with AAA forecasting record travel numbers for nearly every holiday, but prices historically will drop after the ball drops on New Year’s Eve,” said Michael Blasky, a spokesman for AAA Northern California. “Californians today are paying about 60 cents more than the national average, which AAA attributes to the state’s strong economy, higher taxes on gasoline and stricter environmental regulations.”
The last time Californians started a year paying more than $3 for gas was in 2014, when the average price in January of that year was $3.62. Gas prices rose above $4 that summer.

Still, January prices don’t always indicate how prices will move throughout a year. Motorists in California paid just $2.55 for regular unleaded gas to begin 2015, but by May were paying above $3.70 per gallon.

Oil prices were more stable in 2017, with prices for a barrel hovering around $50 much of the year. Prices rose late in the year and began 2018 over $60 a barrel, a 2-year high.
“With global oil producers trying to scale back their production, supply could drop while demand for energy remains high,” Blasky said. “If they’re successful in cutting back oil production, gasoline prices will likely rise as well to meet the demand.”■

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